Cougar Mountain was formed in the Miocene when tectonic forces folded western Washington along a northwest axis and created the Newcastle Anticline. The anticline exposed earlier (Eocene to Oligocene) sedimentary and volcanic rocks that, due to erosion, now form the surface of Cougar Mountain. The northern edge of Cougar Mountain is distinct due to the Seattle Fault, which runs along I-90. The Seattle Fault caused a large earthquake approximately 1100 years ago.[2]

Cougar Mountain is part of the Eastern Puget Uplands level IV ecoregion, as defined by the EPA.[3] This ecoregion is a transition between the ecology of the Puget Sound and the forests of the Cascades. The ecology of Cougar Mountain is thus more similar to the Sammamish Plateau than the rest of the Issaquah Alps.

Cougar Mountain contains species and habitats that were once common closer to Puget Sound. Extensive logging has rendered the ecosystem less diverse than its original state.[3]